Hugh Stevenson, chairman, dismissed recent coverage of the poor performance of some of MAM's funds, saying it was wrong to extrapolate their performance to the rest of the group. He said Mercury's UK Equity fund, which has languished at the bottom of performance league tables in recent months, had been reorganised during the summer and anyway represented only a small proportion of MAM's total managed funds, which reached pounds 104.4bn.
He said that the performance of Mercury's pooled funds should be seen in the context of their five or 10-year records, which showed them among the best funds.
During the first half-year, MAM's profit before tax rose from pounds 81.8m to pounds 88.4m. Underlying profits growth was faster, at 26 per cent, because it excluded the unusually high contribution from lumpy private equity investment disposals which distorted last year's reported result.
Earnings per share rose 3p to 33.9p, from which a dividend of 12.5p, a 25 per cent increase, was paid. Mr Stevenson said the increase was in part a rebalancing of MAM's payout, which has tended to be heavily second-half weighted.
About half MAM's new business came from overseas clients. The group is concentrating on fast-growing asset management markets such as Japan, where the pension fund business has recently been liberalised, and Germany, where funds under management increased by 45 per cent.
MAM's shares, which recently slipped out of the FTSE 100 index of leading companies, closed 20p lower at 1330p. After years of steady growth, the shares have moved sideways throughout much of 1997.